Canadian Innovation Week: Celebrating Women Entrepreneurs

It’s no secret that sexism is rampant in tech culture; there’s a Wikipedia page titled “Sexism in the technology industry,” among the plethora of content that has chronicled the problem in recent years. As announced in the Federal Government’s Budget 2018, the Canadian Business Development Bank has increased the size of its Women in Tech fund to $200 million. It is now the largest VC fund in the world dedicated exclusively to investing in women-led technology companies.

Canadian Innovation Week is an opportunity for us, as a country, to celebrate innovation and mobilize around the goal of strengthening a culture of innovation in Canada. With this year’s inaugural edition of Canadian Innovation Week, it is important to look to innovation bright spots with the potential to make Canada the most innovative country in the world.

One of these areas of potential, which remains a relatively untapped source of innovation, is Canadian women in STEM, more specifically women tech entrepreneurs. Carol Leaman, CEO of Axonify, is an excellent example. Axonify is a rapidly-growing Waterloo, Ontario-based company that created an e-learning software platform to better train employees through gamification (the application of typical elements of game playing—point scoring, competition, rules of play—to other areas of activity).

The company had just two employees when Leaman and a partner bought it in 2011. Axonify now employs 140 people and has $21 million in annual sales. Customers include Walmart, Toyota and Bloomingdale’s. In 2016, Leaman was named one of Canada’s top 100 female entrepreneurs, and she contributes regularly to Fortune magazine. Her many awards include the Sara Kirke Award as Canada’s leading female entrepreneur in 2010.

Unfortunately, successful women entrepreneurs such as Leaman are not easy to find in Canada’s tech scene. Only five per cent of tech companies have a solo female CEO, and women make up just 13 per cent of the average tech company’s executive team, according to a 2017 report by #movethedial, a Canadian non-profit. This is less surprising when we look to where the pipeline for women in tech begins. Lower levels of participation already manifest themselves at the high school level. Later on, we see that—despite representing the majority of young university graduates—women are underrepresented in STEM fields. Tech companies need uninterrupted financing—access to capital at all stages of their growth. This is the game changer when it comes to growth and scaling up, as well as outsized contributions to job creation, particularly in STEM fields, and to the economy. For women tech entrepreneurs specifically, systemic gender bias compounds the challenge of access to capital. Only 10 percent of venture dollars globally between 2010 and 2015 went to start-ups with at least one woman founder. Anecdotally, we have all heard stories of gender bias in venture capital (VC)—stories of the “old boys’ club”. Unfortunately, the research seems to bear this out. In the case of men and women entrepreneurs using the same pitches, men entrepreneurs were more likely to get funded than women. Women entrepreneurs also see themselves awarded approximately 25 per cent of the asked amount of venture capital as compared to 50 per cent for men entrepreneurs.

In addition to the too-shallow pools of available capital, venture capital firms lack diversity in their investment teams. While the number of women partners in Canadian VC firms is increasing, women still only occupy about 12.5 per cent of investment roles. While the ecosystem is beginning to correct systemic biases through women-led accelerators and women entrepreneur- dedicated capital (e.g. Creation of StandUp Ventures Fund administered by MaRS IAF, Fierce Founders Bootcamp, Pique fund, etc.), it needs to be happening faster. We have a great opportunity to up our collective innovation and economic bench strength as a country by providing women tech entrepreneurs with the support they need. We need to first expand the size of the pipeline of women in STEM by improving STEM education for girls and providing them with more role models. Just last year, the federal government launched #ChooseScience—a campaign to encourage young girls and women to enter STEM fields and to provide them with opportunities to engage in the sciences. By celebrating women leaders in STEM, we can overwrite outdated stereotypes. The sharing of their stories provides young girls and women contemplating STEM and entrepreneurship with real role models, allowing them to see themselves in similar roles. When they enter those roles, they contribute to the shifting of the traditionally male-dominated culture found in STEM fields, including in tech companies. Building a culture of inclusion is key to creating a stronger sense of belonging for women and making STEM and entrepreneurship fields in which they can see themselves fitting and thriving.

At BDC, we are upping our game to provide women-led tech firms with the support they need at all stages of their lifecycle. As announced in the Federal Government’s Budget 2018, we have increased the size of our Women in Tech fund to $200 million. This is now the largest VC fund in the world dedicated exclusively to investing in women-led technology companies. We believe this is the kind of investment with the potential to truly make a difference. With a fund of this size, BDC has the capacity to make multiple investments in women-led tech firms along their lifecycle to ensure they have the capital they need at all stages of their growth in order to unleash their full potential. Non-financial support is also key to the growth of these companies. By also providing mentorship, peer-to-peer training, connections and other resources, we hope to equip women tech entrepreneurs with the tools and skills they need to become Canadian innovation success stories and role models.

To continue expanding the tech ecosystem, through the Women in Tech Fund, we will also be supporting and growing the base of emerging female investors and fund managers through mentorship, education and training. Additionally, women-led firms stand to benefit from an increased number of female VCs across the ecosystem. They are not only more likely to get funded but also to have a successful exit when they are financed by VCs with women partners. The hope is that with a growing number of women investors, women tech entrepreneurs will not only have better access to venture capital, but that their growing presence will chip away at the underlying systemic gender bias. We all stand to benefit from a cultural shift toward a higher standard of ethical conduct and a culture of diversity and inclusion. By ensuring a safe, fair, and equitable work environment within the Canadian tech ecosystem and the VC community, more and more women and girls will be able to see themselves in this space.

To make Canada the most innovative country in the world, we must not only look to today’s innovators, but also to those of tomorrow. By providing the support they need today, we hope to propel Canadian women tech entrepreneurs so that those coming up behind them can see them as role models and see themselves in STEM and in entrepreneurship. It is through powerful initiatives like Canadian Innovation Week that we can take a moment to pause and celebrate the successes of women like Carol Leaman. Canadian Innovation Week celebrations also fuel our drive to roll up our collective sleeves to improve conditions and support the next wave of women like her.

Michael Denham is president and CEO, Business Development Bank of Canada (BDC).